Country By Country Reporting (CbCR) Explained

Country by Country Reporting (CbCR) is a mandatory framework requiring multinational enterprises with consolidated revenues exceeding €750m to disclose income tax information by jurisdiction. From financial years starting 1 January 2025, EU submissions must use XHTML with Inline XBRL format, tagged to the taxonomy published by the European Commission. Compliance requirements vary by jurisdiction: Germany enforces strict notification rules and electronic filing via the BZSt portal; Belgium sets early notification deadlines and high penalties; the Netherlands takes a substance-based approach with a more collaborative enforcement posture; Malta requires local filing where parent jurisdiction exchange agreements are absent. Penalties for non-compliance range from moderate fines in Germany to €50,000 in Malta. This article covers the data requirements, filing steps, and country-specific rules that in-scope MNEs need to follow.

Country By Country Reporting (CbCR) is one of several regulatory frameworks now requiring iXBRL-format digital submissions. For a plain-language overview of how XBRL tagging works in practice, see our guide on what XBRL filing requires.

The European Commission has adopted the final implementing regulation for Country-by-Country Reporting. Starting with financial years beginning on or after 1 January 2025, multinational enterprises with revenues exceeding €750 million are required to disclose income tax information using XHTML and Inline XBRL formats.

This framework supports transparency in tax reporting by requiring MNEs to show where economic activity occurs and where tax is paid. For companies operating across jurisdictions, compliance with CbCR regulations is necessary to avoid penalties and maintain good standing with tax authorities.

What is Country By Country Reporting?

Definition and Objectives of CbCR

Country By Country Reporting (CbCR) is a regulatory requirement for MNEs, introduced under the OECD’s Base Erosion and Profit Shifting (BEPS) initiative. The primary objective is to provide tax authorities with a clear breakdown of an MNE’s global allocation of income, profits, taxes paid, and economic indicators across the jurisdictions where it operates.

CbCR enables governments to assess whether companies are paying taxes in jurisdictions where economic activity takes place.

Who Needs to Comply?

CbCR compliance generally applies to:

• MNEs with consolidated group revenue exceeding €750 million in the previous fiscal year.
• Parent entities in jurisdictions that have adopted CbCR requirements.

Smaller entities may not need to comply directly but could face additional reporting requirements under local legislation.

Key Compliance Requirements

What Information Must Be Reported?

MNEs must file CbCR reports with the following breakdown by jurisdiction:

• Revenue (related and unrelated party transactions)
• Profit or loss before tax
• Income tax paid and accrued
• Number of employees
• Stated capital and retained earnings
• Tangible assets (excluding cash or cash equivalents)

Filing Deadlines and Frequency

CbCR reports are required annually. Specific deadlines vary by jurisdiction. Businesses should confirm timelines with local authorities. In most jurisdictions, CbCR reports are due 12 months after the close of the fiscal year, with secondary filings due on the same schedule.

Where to File

CbCR reports are typically filed with the tax authority of the parent entity’s jurisdiction. Secondary filing may be required in other jurisdictions if the parent jurisdiction does not mandate CbCR filing or lacks an automatic exchange agreement.

Country By Country Reporting in Deutschland (Germany)

Germany has adopted the OECD’s CbCR guidelines under its Fiscal Code (§138a AO). While aligned with international standards, Germany enforces strict notification and filing procedures.

Notification rules. Every German-based entity in an MNE group must notify the tax authorities of its CbCR filing obligations, specifying whether it is the ultimate parent entity, surrogate filing entity, or neither. Notifications are due by the end of the MNE group’s fiscal year.

Filing specifics. Secondary filing is required if the parent entity is not obliged to report in its jurisdiction or if the German tax authorities do not receive the report through automatic exchange. Reports must be filed electronically via the ELMA mass data interface or the BZSt online portal BZSt. Note: the Elster platform is for domestic tax matters and is not used for CbCR submissions.

Penalties. Germany imposes penalties for non-compliance or late submissions, though they are generally moderate compared to other tax violations.

How it differs. Germany requires more formalised notification procedures than many other EU countries.

Country By Country Reporting in Belgium

Belgium’s CbCR regulations align with EU Directive 2016/881/EU but include stricter notification procedures.

Notification rules. Belgian entities must notify tax authorities of their CbCR filing obligations via the MyMinfin platform. Notifications are due at the end of the reporting fiscal year, earlier than in most other jurisdictions.

Penalties. Belgium enforces penalties ranging from €1,250 to €25,000.

How it differs. Belgium’s early notification deadlines and higher penalty range are stricter than Germany and the Netherlands.

Country By Country Reporting in the Netherlands

The Netherlands’ CbCR rules operate under the Corporate Income Tax Act 1969.

Substance requirements. Dutch authorities prioritise substance: entities must demonstrate genuine operational presence, including staff, decision-making functions, and legitimate economic activity.

Penalties. Penalties exist for non-compliance. The Dutch tax authority typically adopts a collaborative approach, working with businesses to resolve issues before imposing fines.

How it differs. Compared to Belgium and Germany, the Netherlands takes a more guidance-oriented approach, focused on economic substance rather than procedural enforcement.

For more background on Dutch digital reporting obligations, see our overview of Standard Business Reporting (SBR) in the Netherlands.

Country By Country Reporting in Malta

Malta’s CbCR framework is governed by SL 123.127 and aligns with EU Directive 2016/881/EU.

Local filing. Maltese subsidiaries must file CbCR reports locally if the parent jurisdiction does not require filing or lacks an exchange agreement with Malta.

Penalties. Non-compliance can result in fines of up to €50,000, with daily penalties of €100 for ongoing violations.

Data exchange. Malta prioritises automatic data exchange through OECD agreements, supporting global tax transparency.

How it differs. Malta’s local filing requirement for subsidiaries sets it apart from countries where filing responsibility rests solely with the parent entity.

Steps for Country By Country Reporting

1. Data Collection

Gather all relevant financial and operational data from every entity within the MNE group. Key data points include:

• Revenue, segregated by related and unrelated party transactions
• Profit or loss before income tax
• Income tax paid and accrued
• Number of employees per jurisdiction
• Stated capital and retained earnings
• Tangible assets, excluding cash or cash equivalents

Centralised collection tools reduce the risk of inconsistent data from multiple subsidiaries.

2. Data Validation

Before preparing the report, validate the data against audited financial statements and check for consistency in currency conversions. Confirm correct mapping to prescribed CbCR categories and alignment with local and OECD reporting standards.

3. Report Preparation

Format the validated data using the standardised template. The EU implementing regulation includes a common template for income tax disclosures. The report must be submitted in Inline XBRL format, tagged with XBRL concepts using the EU taxonomy. The XML schema is specified by the European Commission.

The report structure covers:

• Table 1. Allocation of income, taxes, and business activities by tax jurisdiction.
• Table 2. List of all constituent entities by jurisdiction and primary business activities.
• Table 3. Additional information or explanations supporting the data.

4. Submission

File the completed report with the relevant tax authority. In Germany, this is via the BZSt ELMA interface or BZSt online portal (not Elster, which is for domestic tax). In Belgium, via MyMinfin. Submission deadlines are typically 12 months after the close of the fiscal year.

CFOUR Comply supports the preparation and tagging of CbCR reports in Inline XBRL format aligned with the EU taxonomy. Request a demo.

Best Practices for CbCR Compliance

• Use centralised CFOUR Comply reporting software to reduce data aggregation errors and cut manual effort in taxonomy mapping.
• Monitor legislative changes in all jurisdictions where you operate. CbCR requirements evolve.
• Engage tax advisers to assess secondary filing obligations and country-specific deadlines.
• Begin data collection well before the submission deadline. Errors discovered late in the cycle are costly to correct.

Conclusion

CbCR compliance is an established part of global tax governance for MNEs above the €750m revenue threshold. The key to reliable compliance is understanding the country-specific requirements that apply in each jurisdiction where you operate, and maintaining data collection processes that can produce accurate reports under tight deadlines. By following the structured steps outlined above, MNEs can produce consistent, validated Country by Country reports and reduce the risk of penalties.

For companies seeking to meet the EU iXBRL submission requirement, CFOUR Comply provides built-in CbCR taxonomy support and validated Inline XBRL output.

Book a demo.